Morrisons is ready for the possibility of a shareholder revolt over the £3m payout handed out to the supermarket giant’s ousted Chief Exec Dalton Philips.
The big four grocer could see a salient vote against remuneration policies during its annual meeting on Thursday. Last year Philips doubled his pay to £2.1m last year, earning a bonus despite a significant slump in Morrisons’ sales and profits. He was also given a £1.1m payoff when he was forced to leave the retailer in January following five years of unsatisfactory performance.
Morrisons’ annual report said Philips would be eligible for further windfalls under long-term share awards in 2016 and 2017, although both schemes are languishing below the performance thresholds at which they pay out.
It is understood that The Investment Management Association has issued an “amber alert” to its members. The advisory firm Pirc urged shareholders to abstain, saying it had “concerns” over Philips’ pay deal, and the American proxy agency ISS has reportedly told clients to oppose Morrisons’ remuneration report.
Oliver Parry at the Institute of Directors said: “Considering the loss posted by Morrisons and what appears to be a lack of stringent performance targets, all shareholders will need to scrutinise [Philips’] pay deal closely.”